Jeffrey D. Sadow is an associate professor of political science at Louisiana State University Shreveport. If you're an elected official, political operative or anyone else upset at his views, don't go bothering LSUS or LSU System officials about that because these are his own views solely.
This publishes Sunday through Thursday with the exception of 7 holidays. Also check out his Louisiana Legislature Log especially during legislative sessions (in "Louisiana Politics Blog Roll" below).

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21.6.15

Jindal prefers reason over lunacy on pension bill

By the logic of his own statement,
it turns out that state Rep. Sam Jones hates
the people of Louisiana. And perhaps even emulating Gov. Bobby
Jindal in the antipathy of which he accuses the governor, neither of which lead
to good policy-making in the area of pensions.

The ever-reliably partisan Democrat
blowhard, Jones spared no comity, nor any pretense of intellectual coherence,
in criticizing Jindal’s decision to veto HB 42,
which would have inserted a pension raise of up to 1.5 or 2 percent (depending
on the system) for state and teacher retirees and beneficiaries already
pensioned for the first $60,000 paid. This would void a law passed last year
that would provide such a raise no more often than every other year as part of
a strategy to bring down the state’s unfunded accrued liabilities from a
stratospheric $19 billion that must be paid off by 2029 at an average cost to
the citizenry of $1.5 billion a year.

Essentially, the law would insert
at least an extra year’s worth of increase, guaranteed. Current law prohibits
an increase for this year, as part of the mandatory skip, but the bill would
slot one in. Further, even for FY 2016 and beyond a raise is not guaranteed,
for it would be determined on the basis of the change in the Consumer Price
Index-Urban indicator by being no higher than that (and capped at a maximum
depending on system health which currently would suggest this figure be 1.5
percent), if the fund in question earned an adequate rate of return. If because
of this proposed raise that the metrics towards elimination of the UAL were not
met, the bill specified that the employer – the state or local agencies who use
taxation power to fund salaries – would pay the difference. The math showed in
the first five years that this meant an additional liability of $70 million,
for which taxpayers ultimately would be liable.

The current law passed last year
attempted to shore up in aggregate the financial health of the systems, rated
among the poorest of the states, by permitting pension increases only when
return on the year ending a year before the increase was sufficiently good and
its size dependent upon inflation and the degree of underfunding still present.
One part of the bill, added to the original, also made amortization schedule
changes that also could improve system health. Another addition delayed the
guaranteed increase for a year, which Jindal
indicated was acceptable.

But at the last minute, its lead
author Jones rejected that delay and the compromise bill passed with the hike
effective this Jul. 1 – never mind that the structural changes, as recommended
by the systems, could have been passed without including the immediate hike. Jindal,
reflecting concerns voiced by major bond rating firms that suggested deviation
from the previous year’s enactment was indicative of lack of budget discipline
that could lower credit ratings as well as other
elected officials’ concerns about inflating the UAL, vetoed
the bill.

Which unhinged Jones. He started off
his critique with all of the subtlety of a mass shooter by opining that Jindal
was “the most deceitful, hateful governor I've seen in my lifetime,” and then
he got rude, sputtering “Whatever his burning hatred is for state employees and
teachers, I guess on his way to Iowa he had to stick his finger at them at one
more time,” making reference to Jindal’s all-but-certain quest for the
presidency. He also lapsed into men-in-white-coats-with-rubber-truck-coming-to-get-me
territory when he declared a purpose of the veto of the bill was to “help a
future governor sweep these retirement funds for an illegal purpose.”

He chose not to reveal what he knew
of this grand conspiracy that implicated any of the four major candidates
running to succeed Jindal, even as all of them have distanced themselves from
the governor (perhaps to draw suspicion away from the grand plan Jones alleges
exists). Or maybe when he referred to a “future governor” he meant someone who
would not run until 2019? 2023? Beyond? Then again, it’s hard to figure out
exactly what and how a lunatic thinks, even if for that analytical purpose we’ve
been graced with plenty of bombastic coprolites issued forth from his mouth not
just on this occasion.

In any event, if in Jones’ world Jindal
“hates” state employees and teachers because he did not want make the people
pay at least $70 million to transfer more wealth to retired state employees and
teachers and their beneficiaries, then it’s entirely fair to say Jones “hates”
taxpayers who would have to make up for this and/or citizens who suffered cuts
in services as a result. In fact some of those who could end up paying for the
additional benefits are, guess who, state employees and teachers. So by his own
twisted reasoning, it seems Jones joins Jindal in his “hate” of them.

The UAL is not going away, and choices
must be made in how to deal with it. An immediate retiree/beneficiary boost,
when the vast majority of these recipients do not depend only on a state
pension (because of spouses’ retirement income and double- and even
triple-dipping), and many who get only a state pension get
a relatively handsome one (given the disproportionately better compensation
that state employees get than those who perform similar tasks in the private
sector and the average teachers’ salary being roughly $10,000 a year higher
than per capita income in the state, often for fewer hours worked per year), and
the law in place provides a mechanism for pension increases beginning next
year, the case to load up for this year that triggers more costs to taxpayers
is negligible.

Sober analysis supports Jindal’s
decision, much more so than the rabid foaming-mouth approach taken by Jones. In
making good public policy, reason rather than name calling always serves
better.

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